
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, May 17, 1990                   TAG: 9005170249
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-8   EDITION: METRO 
SOURCE: The Baltimore Sun
DATELINE: WASHINGTON                                LENGTH: Short

HARDER TIMES AHEAD FOR EUROPE, CIA SAYS

Economic hardship in Eastern Europe is likely to worsen, the Central Intelligence Agency forecasts, and it says that "significant growth and improvement of living standards in the region, at best, will take years."

Even if governments in Eastern Europe press on with their efforts at economic reform, the CIA said in a report released Wednesday, overall "growth in the region is likely to deteriorate further in the short term."

As governments "aggressively" implement austerity measures amid a prolonged decline in living standards, the agency cautiously raised the danger of "public protest that could set back reforms and economic recovery."

Throughout Eastern Europe "the realities of the economic situation . . . are daunting," the report said, but it noted that the pain would be spread unevenly for varying lengths of time.

In East Germany, for example, the changeover from a command economy to what the West Germans call a "social market economy," was expected to inflict short-term hardship as unemployment spurted to 15 percent to 20 percent "over the next year or so," the CIA said.

But "East Germany's long-term economic future is bright because of the nearness of unification" with West Germany, the report said.

Less favored were the rest - Hungary, Czechoslovakia, Bulgaria and Romania, each with its own set of problems.

by CNB